Prognosis for world capitalism: New crises, attacks on workers

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'Capitalism, the material foundation from which this social insanity springs, The following is an abridged and edited version of the Draft Political Resolution approved by the July 1990 Socialist Action National Convention.

In an amazingly brief space of time one of the most breathtaking series of revolutionary mass mobilizations in history has swept through the degenerated and deformed workers states of Eastern Europe. It is no exaggeration to say that the crumbling of Stalinism in Eastern Europe has qualitatively changed world politics.

The facade of Stalinist omnipotence collapsed under the feet of angry millions marching in the streets. It has opened up a period of pre-revolutionary political struggle in these countries that will not come to an end until the workers have had their say.

But, in the meantime, the bureaucracies are still far from being dislodged from their positions of control in the industrial and state apparatus. And they will not be dislodged without the conscious action of the workers in their own name, in their own class interests.

In the current political context—in which the working class has stayed on the sidelines-the anti-Stalinist movements have come under the influence of the middle classes who are reinforcing the [capitalist] restorationist tendency of the Stalinist bureaucracies.

Although at this point there has not yet been established the nuclei of revolutionary proletarian parties in these countries, the opportunity for their construction has opened up and will grow in the coming months and years. One of our tasks in the period ahead will be to do what we can to help this movement toward achieving this goal.

We have already taken a number of small steps in this direction. We organized a delegation to the Soviet Union in the spring of last year, and another that arrived in China shortly after the Tiananmen massacre. We sent a correspondent to Romania after the bloody uprising there that overthrew Ceascescu. Soon afterward we inspired friends of the party to go to the Soviet Union and Poland, and we sent a delegation to Eastern Europe in the spring.

As a result, we have gained a clearer picture of the pace of development and the nature of the class forces in motion and made some contact with a very small layer of an emerging vanguard of our class.

These are extremely modest efforts but are quite impressive given our size. Small as we are, we intend to be a part of the unfolding process of world revolution because of the special contribution we can make toward its ultimate success.

Our main tasks, however, continue to be in our own country. This is not in any sense in conflict with our internationalist perspective. In fact, it is our consistent revolutionary socialist world outlook that sets us apart from all our opponents.

In this connection, it is no exaggeration to say that world events, which are confirming our theoretical and programmatic positions with each passing day, have begun to favorably alter the relationship of forces between us and our opponents. This small advantage today, will have far greater effect in the next period, when the working class is impelled by events onto the road of class struggle.

Capitalism's eroding foundations The colonial and semi-colonial world has remained in an uninterrupted pre-revolutionary state since the end of World War I. Now the Stalinist world has also entered a prerevolutionary state of unequalled instability.

The chain of imperialism continues to break at its weakest links. In these spheres, the "chief obstacle in the path of transforming the prerevolutionary into a revolutionary state is the opportunist character of proletarian leadership...

These words remain as true today as when Trotsky wrote them in 1938.

In the imperialist centers of world capitalism, Trotsky stated, "the opportunist characCATIONS RS OF ICA TELL TELL AND AND ter of proletarian leadership: its petty bourgeois cowardice before the big bourgeoisie and its perfidious connection with it even in its death agony..." opened the door to the catastrophe of World War II.

Again, at the end of the war, further reformist betrayal of revolutionary opportunities allowed imperialism to regain its equilibrium and opened up a new period of capitalist expansion. It was thus granted a new lease on life, condemning the world's peoples to suffer nearly another half century of imperialist counter-revolutionary wars, intensified exploitation and oppression and ecological disaster.

It is difficult to exaggerate the full consequences of the failure to resolve the historical crisis of proletarian leadership during the pre-revolutionary period of the 1930s and 40s. In line with Trotsky's 1938 warning, the whole culture of the human race has begun to unravel.

It has reached a point where the very earth upon which we live is gasping for breath and whole peoples in Africa, Asia and Latin America are steadily being pushed back to a level of subsistence that is worse than that belonging to a distant past. A condition of existence in which natural disasters-floods, droughts-unnecessarily condemn millions Joseph Ryan/Socialist Action COMMUNICATIO WORKERS OF AMERICA AFL-CIO ON STRIN AGAINST PACIFIC BEL AND NEVADA BEI to starvation, disease and painful death.

Capitalism, the material foundation from which this social insanity springs, faces deepening contradictions. But as we noted in the 1988 Political Resolution, while the long period of economic stability is showing signs of exhaustion, "No one can predict when the current economic phase will come to an end or what will bring the developing crisis to a head."

The assault on living standards In the last two years, even though further evidence of the deepening crisis continues to surface, such as the collapse of the savings and loan industry which threatens to capsize the nation's entire banking system, the ruling class has remained able to contain the damage and keep the whole system from reeling out of control. In the meantime, capitalism works incessantly to intensify the rate of exploitation and thus postpone economic collapse.

One of the most obvious consequences of this is the absolute decline in workers' real per-capita income. According to government statistics, which notoriously understate such bad news, real hourly wages fell by five percent in the last twenty years. But other statistics from the same source inadvertently SOCIALIST ACTION suggest a more serious decline in the quality of life for an ever-larger proportion of the population.

It is well known that the 40-hour week has become a legal fiction and has been expanded in most industrial jobs by built-in overtime. Workers have contradictory feelings toward institutionalized compulsory overtime. They welcome overtime, even compete for it in slow periods, in order to compensate for declining real wages. But they are, at the same time, increasingly resentful when they are forced to go week after week without a day off.

Moreover, despite the increase in the real work-week, the average working class family requires two paychecks in order to keep up with the cost of living and to satisfy their natural desire to enjoy new products, like color TVs and VCRs.

But they nevertheless feel short-changed because they instinctively sense that although many may enjoy a wider variety of commodities, their share of society's increasing total product steadily decreases in step with the intensifying rate of exploitation.

Furthermore, one of the more insidious consequences of bureaucratic misleadership has been the proliferation of the two-tier system in which the young entering the workforce are condemned to a period-which tends to grow longer—of significantly lower wages than their parents. And the lower standards of the sons and daughters are then used by the bosses to drag down the standards of their mothers and fathers as well.

These and other setbacks have resulted in a sharp increase in the number of women compelled to become breadwinners just to stay abreast of what they consider to be their rightful living standard. The number of women in the workforce has thus climbed from 28.9 million in 1970 to 52.8 million as of May 1989.

This, of course, has a positive side. Women gain a greater measure of independence from male domination when they establish their right to jobs. On the other hand, many women and/or other family members who enter the workforce are often only able to maintain a living standard no higher than that achieved with only one family member working.

The latest reports from the Bureau of Labor Statistics show that the continuing offensive against living standards has forced a startling increase in moonlighting-workers holding two jobs—with the main burden falling on women. And often there is no improvement—in many cases, a marked decline-in the quality of life, especially for single heads of households.

From 1970 to 1989 the percentage of men holding two jobs went down from 7 to 6.4 percent, while in the same time-frame, that of women rose from 2.2 to 5.9 percent. (The absolute numbers of both sexes holding two jobs, however, went up in line with the absolute increase of jobholders between 1970 and 1989. Combined employment of men and women rose during that 20-year period from 77.6 to 117.1 million.)

Furthermore, Labor Department officials caution that the number holding two jobs may be significantly understated given the fact that many of these workers are paid in cash and might not report it to avoid paying a higher tax-rate on the extra income.

The growing tax ripoff This leads us into the other main method by which capitalism increases the rate of exploitation-the steady shifting of the tax burden from the rich to the poor. There has been an explosive growth in regressive taxes. The sales taxes of various kinds have proliferated. They exact a flat percentage of much, if not most, of a workers' wages, but leave up to 99 percent of the income of the rich untaxed.

The Social Security tax is no less regressive, taking a flat percentage of every dollar earned by most workers. (And then what is left is taxed again when spent!) Senator (continued on next page)

SEPTEMBER

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ERN SUPPORTS ...'the decisive factor in the current struggle has been the 20-year-long series of outright givebacks to the bosses by the top labor bureaucrats.' 8 SOCIALIST ACTION SEPTEMBER 1990 (continued from previous page) Moynihan's sudden "discovery" of this longstanding injustice, and his proposal to reduce or eliminate it, is pure hypocrisy.

No real reform will come of it. It is entirely intended to put his party in position to capture and contain the gestating mass rebellion against the soak-the-poor tax policy of his class.

And even if there would be a reduction of the Social Security tax, we can be absolutely certain that workers will be made to pay through the nose some other way. The twin parties of capitalism will either be forced to reduce social benefits or saddle workers with another variety of regressive taxation—or a combination of both. The only other alternative would be to set-off a massive increase in the gulf between government spending and revenues-and with it, hyper-inflation.

But the income tax system, itself, is crassly regressive. It has, however, a deceptive " progressive" facade. Many workers look at the tax tables and are deceived into thinking that the higher the income the higher the rate of taxation.

However, the naked truth is that the "progressive" rise in the rate of taxation applies only to the workers, while capitalists effectively pay a lower rate as their income goes up. This outrageously unjust tax system has been steadily made worse by Presidents Carter, Reagan and Bush, not to mention their predecessors going back to Roosevelt-with the whole-hearted support of both capitalist parties.

But while from the first turning of the tax screws there has been a pained reflex from the working class, it had been successfully diverted by the ruling class into a weapon against the most exploited victims of the system, especially those whose very hopes for a job have been expunged by capitalism's ruthlessness.

The failure of the workers' leadership to mount a vigorous opposition to the increasingly regressive tax system permitted the capitalists to use it in classic divide and rulestyle. The manufacturers of "public opinion" were unchallenged as they painted a sordid picture of "welfare queens" living high on the hog while the "middle class" had to pay the tab.

Little did many of the better-off workers, and others in similar circumstances realize that their own social benefits were as much the target of the bi-partisan tax offensive.

It worked well for a while. But now the broader sections of the working and middle classes are beginning to suffer from a similar slander campaign while their own social benefits are being attacked.

Only last year we began to read about the "powerful lobby" of "greedy" retired senior citizens. They had dared to raise an outcry against a heavy tax on their meager incomes to finance an alleged program to protect seniors from catastrophic medical costs.

It didn't work: The catastrophic insurance scheme was full of loopholes and the cost to pensioners too high. Under the pressure of massive protests, the tax was revoked and the "catastrophic" insurance plan dumped— but without anything put in its place.

So far, we have not heard much more about our "greedy" seniors. This should not be viewed as a passing episode, but rather as symptomatic of the sharpening dilemma of capitalism. They will be compelled to mount increasing attacks affecting wider layers of the masses. If capitalism cannot find a way to open the road to a new period of expansion, the attack on living standards must accelerate. This will inevitably trigger an explosive rise in mass protest and class consciousness.

American socialist revolution The potential for socialist revolution in the United States is greater than ever before. While prosperity continues, despite horrendous growth of the most extreme poverty in its midst, it has taken place at the expense of exhausting much of the financial reserves that played a big role in enabling American capitalism to survive the depression.

Those reserves—which Trotsky called the "fat from the past [that] permits Roosevelt his experiments..." was partly expressed in the position of the United States in the 1930s as the largest creditor nation in the world.

Today, this country is the largest debtor nation in the world. And an escalation of American indebtedness to fantastic new heights is built into an economy which must bear the expense, among other things, of the largest military force on the face of the earth.

In contrast to the 1930s when Roosevelt was able to experiment with concessions to the workers and other measures designed to enable capitalism to climb out of the most serious economic crisis in its history, these financial reserves have been steadily spent to prevent a recurrence of another such profound crisis.

This financial exhaustion of its reserves is compounded by the objective weakening of capitalist social, economic and political power in three important areas:

• The Black and women's struggles have begun to batter down two of the most important social props of American capitalism—racism and sexism. These are major weapons in the capitalist arsenal for dividing the working class. There remains a long way to go, but the power displayed by these social layers makes them far more attractive allies to American workers which will make it easier for revolutionists to unite the class as a whole, along with its natural allies.

• The Marshall Plan financed the economic resurrection of European capitalism and helped save it, and its world system, from social revolution. But the price American capitalism paid has been the evaporation of much of the competitive economic advantage it had held in the 1930s, '40s and '50s. And with it, a measure of American capitalism's inner resources has also faded away.

• American capitalism's need to rapidly accelerate the rate of exploitation in the aftermath of WWII led it to mount a prolonged assault on labor's rights and living standards. The myth of a pro-labor wing of the capitalist class has been seriously eroded by this bipartisan political and economic assault.

The word "liberal" has little left of its old meaning to American workers. The capability of capitalist demagogues to deceive sections of the working class has been significantly reduced, although far from eliminated. The road to independent labor political action, at the very least, will be easier in the next major crisis than it was in the last.

Pittston strike

In the last couple of years, three industrial conflicts serve as a gauge of the current level of trade union and working class consciousness-the strike of coal miners against the Pittston Coal Group, the strike of machinists against Boeing and that of airline mechanics against Eastern Airlines.

The ten-month strike by 1,700 miners in Virginia, West Virginia and Kentucky against Pittston showed labor at its best. It has been the most effective labor struggle since the United Mine Workers of America's (UMWA) own general miners strike of 1977-78. The Pittston strike, moreover, took place in the face of a major challenge to their picket lines by mineowners, state and local cops and anti-picketing injunctions backed up by an unprecedented $64 million in fines.

Eleven years ago, miners were victorious despite President Carter's strike-breaking attempt to use troops to force them to mine coal, and despite a stab in the back by the AFL-CIO's top bureaucrats who had backed Carter's attempt to force miners back into the pits with the threat of National Guard bayonets.

Unfortunately, since that time a gradual erosion of the miners' position has continued to take place, partly as a result of a revolution in mining technology which has led to a massive reduction in the number of working miners. (Technology has eliminated almost half a million mining jobs since the 1950s and, at the same time, increased production.)

The fewer jobs available increases competition among miners. This advantage for mine owners gave them the ability to break the union hold over a large section of the industry. (Union control slipped from 90 percent in the 1950s to a third of the industry But the decisive factor in the current struggle has been the 20-year-long series of outright givebacks to the bosses by the top labor bureaucrats. In line with this concessions policy, they have also worked assiduously to block any mass fight-back by the working class.

Real labor solidarity, honoring picket lines during strikes, has been virtually banned by the labor bureaucracy to the point of it being proscribed by most union contracts. Class solidarity has been reduced by them to essentially moral and some financial support.

The resulting demoralization and the defeatist mood generated by bureaucratic treachery in the ranks of labor has reduced Pittston strikers' ability to inspire the outstanding level of national grass roots labor response they had succeeded in mobilizing a decade ago.

Even so, the strike inspired an unusually high level of solidarity: A thousand unions, churches and community groups, mainly in the areas closest to the struggle, rallied to the miners' cause, including some participation in mass picketing-the key to the success of any strike when picket lines are challenged by the boss.

In a sense, the sheer weight of their class struggle traditions permitted the Pittston miners to mount a remarkable defensive struggle based on mass picketing to stop coal deliveries in defiance of anti-strike injunctions and massive fines. The high cost to the struck company brought it to the bargaining table. (Pittston admits to $27 million in "lost sales and other expenses," but it is no doubt considerably higher.)

But a larger factor bringing the bosses to terms was the UMWA's actual steps toward extending the Pittston conflict to a general miners' strike.

Shortly after UMWA President Trumka's election he initiated a break from the historic policy of the union which had been on insistence on negotiating industry wide contracts for all coal miners.

Thus the miners were led into a battle on the most unfavorable grounds of pitting a small portion of the UMWA membership against one company, but one which had behind it the full force of all the coal bosses, the repressive agencies of the capitalist state, and the ruling class as a whole.

However, the rank and file instinctively saw the road to higher ground. Wildcat strikes erupted throughout the coal fields reflecting the class struggle traditions of the UMWA membership and demonstrating miners' readiness to stop all coal production.

This knocked the strategists running the Pittston Company's union-busting assault off balance. They knew such an extension in the breadth of the strike could have set in motion a general rise in class consciousness that would have altered the overall relation of forces between the opposed classes in favor of labor.

The ruling class responded to the miners' mobilization with both stick and carrot. The bosses and their agencies levied new fines and increased police repression. But at the same time they sent signals of a willingness to compromise, including backing off from some of the worst take-away demands. The UMWA leadership chose to compromise.

The result was that Pittston miners were able to hold on to most of their health and retirement benefits and job security, including a hiring policy that will tend to replace non-union workers with laid-off miners. These were two of the key issues in dispute.

But Pittston miners have been compelled to permit "flexible" schedules, an important concession to the company. UMWA leaders also promised to adhere to anti-strike laws in the future. They also decided to retreat from their earlier position and allow a vote before the issue of the fines was resolved. Miners voted to go back to work with $64 million in fines still hanging over the union's head.

(This was somewhat offset by the company's agreement to join the union in asking the court to forgive the fines. But the court's intransigeance indicates that the bulk of the fines will be held in abeyance primarily to enforce the UMWA leadership's pledge to obey future injunctions in coming struggles.)

Overall, however, the strike must be seen as a clear victory tor miners and all labor, given the bosses' attempt to bust the union and given the unfavorable objective context created by over four decades of a step-bystep, bureaucratic demobilization of a fighting labor movement.

Despite the concessions they have been forced to make, miners certainly have gone back with justified pride and self-confidence at their demonstration of fighting ability. The bosses will be sure to weigh plans more carefully when the current general miners' contract expires-but so too must the UMWA; the concessions granted to Pittston will be demanded by the coal bosses as a whole.

Boeing strike

The strike by the International Association of Machinists (IAM) against Boeing showed (continued on page 13)

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